Palestinian Authority Chairman Mahmoud Abbas on Saturday declared the issue of prisoners to be a top priority, saying there would be no peace agreement with Israel until the issue was resolved, the Maan News Agency reports.

"There will be no peace until all Palestinian prisoners are freed from Israeli jails," Abbas announced.

Abbas' new precondition for talks with Israel comes as he seeks reconciliation with Fatah's archival Hamas. The Islamist movement Hamas and Abbas' Fatah organization have been at loggerheads since Hamas unexpectedly defeated Fatah in 2006 legislative elections.

The feud erupted into violence in the Gaza in June 2007, when in a week of bloodletting, Hamas routed Fatah loyalists and sent the Palestinian Authority packing as it seized full control of security installations there.

New efforts to reconcile Fatah and Hamas began again on March 16, when Abbas accepted an invitation from Hamas Primer Minister Ismail Haniyeh to visit Gaza. But that trip was subsequently cancelled when Hamas said it would not guaranteee Abbas' safety during the visit - a statement Fatah leaders took to be a threat.

According to Maan, several Hamas lawmakers and leaders in PA administered areas have since received invitations to meet with Abbas in Ramallah in order to start dialogue about negotiations for a unity government.

Abbas has gone so far as to say he will forego U.S. dollars to the cash-strapped Palestinian Authority for the sake of unity with Hamas.

In an ironic twist, however, Abbas finds himself confronted with the same demand not from Israel, but from Hamas concerning imprisoned terrorists. Hamas says Abbas must release all of its fighters held in PA jails before discussing unity between the feuding factions, Maan reports.

Al-Qassam Brigades spokesman Abu Obeida issued the demand in response to Abbas' initiative reconcile with Hamas. Abu Obeida insisted national unity could only succeed if Abbas released political prisoners in PA jails and stopped coordinating with Israel in accordance with the Oslo Accords.

For its part, Israel has made it clear it will not deal with the Western-backed Palestinian Authority if it brings Hamas into the government, a senior Israeli official said Saturday night, a few hours after PA Chairman Mahmoud Abbas met in Ramallah with a senior Hamas delegation for conciliation talks.

"Abbas has to choose whether he wants peace with Israel or peace with Hamas," the official said. "He can't have both. If he chooses peace with Hamas it will bury the peace process [with Israel]."